RF's Financial News

Sunday, April 27, 2014

Everyday I get the simple pleasure
of seeing CNBC parade cheerleaders across my TV screen knowing that not one of
them:

- Forecast
the housing bubble,

-Forecast
the credit bubble,

-Forecast
the great 2008 crash,

-But are
quite content telling me how wonderful things are and how everything’s coming
up roses.

What I find even more interesting,
is that the people that DID predict these bubbles are viewed as being ‘off
limits’ to the network. You see, in 1983
(before CNBC), 90% of all of our news was delivered by 50 companies. By the year 2000, just 8 companies controlled
90% of the major media, and by mid-2012 it was down to 6.These six companies are: Disney, GE,
NewsCorp, Viacom, Time Warner and CBS. Together
these 6 companies own over 90% of everything we read, watch and listen to.I understand that the purpose of CNBC is not
to inform and educate, but rather to make stocks look attractive at all times,
to make the economy appear fine, and to deliver more revenue to advertisers. The good news is that people are waking up to CNBC’s
agenda, as their viewership has plunged dramatically for the past several
years.

Unlike CNBC, some of the brightest
investing minds on the planet all seem to agree that we're on a rocket ride to
oblivion. People like: Jim Rogers,
Richard Russell, Victor Sperandio, James Turk, Grant Williams, Peter Schiff,
Egon von Greyerz, Jean-Marie Eveillard, and dozens of others running trillion
dollar pension and market funds have declared the system – defunct.These people receive no acknowledgment or airplay.

As the old adage suggests: ‘Somebody's
gotta be wrong.Who’s it gonna be?’
Is it the folks at CNBC, that didn't see the housing – credit – or mortgage bubbles,
and see no inflation, and only see great earnings?Or is it the professionals from the trenches
that have made fortunes understanding reality?My money is on the professionals.

As I'm typing this, tensions are really
beginning to escalate in the Ukraine.The
U.S. wants to bring Russia to its knees using our central bank monopoly on
global credit and banking, while at the same time putting on a show of military
force. Some outlets think that this is
just a smoke screen to purposely drag Russia into a prolonged war, because that
will lead us out of our economic paralysis.I truly hope that isn’t the case.The issue with this particular altercation is that we’re not dealing
with sand dwelling nomads in caves. We're
dealing with Russia – a country larger than ours, and equally equipped with
nuclear weapons. Do we really want to put
the decision of ‘pushing the button’ in the hands of a ‘stressed-out’ War
General with a death wish?

I'm of the opinion that if we end up
going to war over this – it’s as a result of our criminal banksters.It won’t be because we are in a position of
power, or our desire to take over Russia. It will be because the ‘powers that be’
understand that our systems are all horribly broken, cannot be repaired by any
conventional means, and need a war to blame it on.That way instead of the criminal banksters
saying: "I’m sorry for our money printing and our trillions of dollars in
derivatives", they can say: "I’m sorry, we were fixing things, and
then the U.S. got us into a war that led us into bankruptcy.”

I think the overall message here is
that the most brilliant investors of all time say the monetary system is broken,
and needs to be reset. Assuming a war with
Russia can be avoided, the result will be a strong alliance between Russia,
China, Brazil, and India. Some seem to
think that China won't try and crush the U.S. economically because we buy all of
their stuff. Honestly, that WAS true
until our economy got to the point where:

-The average
family does not have $2,000 to get through an emergency,

-Before
student debt topped a trillion dollars,

-Before
wages stagnated for 15 years while inflation roared, and

-Before
entry level jobs went from $15/hr. to minimum wage.

In late May, I expect to hear of a huge
energy deal between Russia and the China. I expect a broad expansion of ‘free trade’ in
gold backed Yuan between Brazil, Russia, India and China. Factually, Japan is working closely with
Russia to develop the gas fields on the northern islands.Also, Russia has a plan in place to forgive
billions in North Korean war debt in return for safe passage of a gas line
through the country to South Korea and the fees it will generate for North
Korea. These nations and others are
working around the U.S.’s petro dollar fiasco.It very much reminds of boiling a frog – it’s a slow process but death
is none-the-less eminent.

Many of the things that keep the
biggest and brightest of the investing world concerned don’t make it to your
local news. With 90% of Americans only
having a half-dozen news outlets – we are all incredibly vulnerable.I continue to remember the scene from the
movie Chicken Run – where the head chicken says three times: “We mustn’t
panic.We mustn’t panic. We mustn’t
panic.” And then proceeds to run around like the proverbial ‘chicken with her
head cut off.’Factually: almost 70% of
the companies that have reported earnings thus far – (if not for buying back
their own stock) – would have missed their projections on both the top and
bottom lines.That is an unheard of
percentage and one where ‘panic’ may be the word of the day.

The Market:

Once again the market has come to
one of those crossroads where everything points to a decline.

-The
crisis in the Ukraine could easily balloon into something truly ugly.

-The
earnings reports coming out of corporations are poor. Now, I realize that the markets move because
of the FED and the carry trade, but it’s becoming more and more difficult for
the analysts to convince people to buy stocks that are trading at over 100
times forward earnings. After all –
didn’t we see that movie in 1999?

-Lastly,
the market is back within spitting distance of its all-time highs, and that's a
pretty hefty bar to leap over when you're attempting it with no volume, and
lousy earnings.

So if nothing happens in the Ukraine
(between now and Monday morning), do the animal spirits come in on Monday and
push us higher?It is indeed possible.But realize that right now, instead of
several hundred stocks moving higher, the market has become increasingly narrow.Therefore, on market ‘up days’ only a very few
stocks are currently dragging the entire market indexes higher.Corporate ‘Insiders’ are still selling at a
furious pace.And, the housing numbers
out last week were just horrific.

But again I warn you; I’ve seen this
movie before.The FED has pulled a
rabbit out its hat many times.So, even
though we are once again perched for a slide, we could see our FED use the 50-day
moving average on the S&P for support, and just trade us sideways as they
attempt yet another in a long string of pushes for glory.

Another issue to consider is the old
adage: “Sell in May and go away." While
it sounds like a gag, it is not. The
market traditionally does its best work between September and April, and often
its worst work in the summer.The FED
could just run out of bullets for this summer, and let things drift for a
couple months.

And then what about the FED's tapering?
All it would take is for Lady Yellen to
say they've decided to halt the taper process, and we would set a new high that
same day. If Lady Yellen came out and
said that they had replaced the QE program with something else to jam money
into the system and keep rates low, we would see DOW 18K by year-end.

For now, I would use the
‘technicals’ as your guide.The XLF (the
banking ETF) has already dipped below its 50-day moving average, which is bad. Markets can’t go anywhere without the
financial sector, so if the XLF can’t get back above 21.90 – be careful.Secondly, while the 50-day on the S&P (SPY)
isn't as important as it was years ago, it's still a psychological level and if
we fail that, it could cause more selling.

With the trouble in the Ukraine, energy
has responded well for me.I have listed
many of my favorites below.But overall,
we're in a touchy area where caution is warranted.

Tips:

TLT continues to be the magic elixir that the market
badly needs.TLT is a ‘bond market’ ETF
(Exchange Traded Fund) that when the market goes up – trades sideways, and when
the market goes down – trades nicely higher.Mannkind Pharmaceuticals (MNKD) remains in our portfolio paying 2% per
week on it’s covered call options.That
is to say: you can purchase a share of MNKD for $6.20 today – and sell the $6.50
call options paying you 13 cents per week.The energy sector continues to ramp higher, and I’ve listed some of my
‘lower priced’ holdings in the sector below.I continue to believe that the precious metal miners are a very
under-valued sector – and therefore continue to play the DUST / NUGT
combination.I like TLT, Gold and energy
– and am awaiting a pullback on the NASDAQ.

Expressed
thoughts proffered within the BARRONS REPORT, a Private and free weekly
economic newsletter, are those of noted entrepreneur, professor and author, R.F.
Culbertson, contributing sources and those he interviews. You can learn more and get your free
subscription by visiting: <http://rfcfinancialnews.blogspot.com>
.

Please
write to Mr. Culbertson at: <rfc@culbertsons.com>
to inform him of any reproductions, including when and where copy will be
reproduced. You may use in complete form or, if quoting in brief, reference
<rfcfinancialnews.blogspot.com>.

If
you'd like to view RF's actual stock trades - and see more of his thoughts -
please feel free to sign up as a Twitter follower - "taylorpamm" is the handle.

If
you'd like to see RF in action - teaching people about investing - please feel
free to view the TED talk that he gave on Fearless Investing: http://www.youtube.com/watch?v=K2Z9I_6ciH0

To
unsubscribe please refer to the bottom of the email.

Views
expressed are provided for information purposes only and should not be
construed in any way as an offer, an endorsement, or inducement to invest and
is not in any way a testimony of, or associated with Mr. Culbertson's other
firms or associations. Mr.
Culbertson and related parties are not registered and licensed brokers. This message may contain information
that is confidential or privileged and is intended only for the individual or
entity named above and does not constitute an offer for or advice about any
alternative investment product. Such advice can only be made when accompanied
by a prospectus or similar offering document. Past performance is not indicative of
future performance. Please make sure to review important disclosures at the end
of each article.

Note:
Joining BARRONS REPORT is not an offering for any investment. It represents
only the opinions of RF Culbertson and Associates.

PAST
RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS
THE OPPORTUNITY FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING
ALTERNATIVE INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER
VARIOUS RISKS INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE
INVESTMENT PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT
TO THE SAME REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES,
AND IN MANY CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN
ONLY TO THE INVESTMENT MANAGER.

Alternative
investment performance can be volatile. An investor could lose all or a
substantial amount of his or her investment. Often, alternative investment fund
and account managers have total trading authority over their funds or accounts;
the use of a single advisor applying generally similar trading programs could
mean lack of diversification and, consequently, higher risk. There is often no
secondary market for an investor's interest in alternative investments, and
none is expected to develop.

All
material presented herein is believed to be reliable but we cannot attest to
its accuracy. Opinions expressed in these reports may change without prior
notice. Culbertson and/or the staff may or may not have investments in any
funds cited above.

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>
Until next week – be safe.

Sunday, April 20, 2014

Sometimes the easiest way to hide something
is to put it out there – in plain sight.Recently, a study was done to examine people’s perceptions as they were
walking.The subjects were asked to walk
down a sidewalk and report any unusual findings.The sidewalk was of regular size.Along one side of the sidewalk was a brick
wall, with the other side being open to the street.All the people had to do was stroll along the
walk, and report anything they may find unusual.One by one the test subjects walked the
sidewalk, and virtually every one of them found the quarter that the testers
had placed on the sidewalk itself.Not one single person noticed any of the $10
bills that were taped to the brick wall – exactly 7 feet off the ground.Not one person.Everyone looked "down" and found
the 25 cents, while no one looked up to find $10. The real prize (that was worth 40 TIMES what
they found) was hidden – right there in plain sight.

In my line of work, sometimes the
most glaring evidence is hidden from us in plain sight. For example, this week we all paid our taxes,
but studies tell me that less than one percent of us know: Why we have taxes?Enter Beardsley Ruml – an American
statistician, economist, philanthropist, planner, adviser to President Herbert
Hoover, director and chairman of the New York Federal Reserve Bank, active in
the Bretton Woods Conference (that established the international monetary system),
and was paramount in planning the ‘New Deal’.

In 1945 Mr. Ruml made a famous
speech to the American Banking Association (ABA), saying that since the end of
the gold standard, “Taxes for Revenue are Obsolete”. The real purposes of taxes were:

- To
"stabilize the purchasing power of the dollar",-To
"express public policy in the distribution of wealth and of income, in
subsidizing or in penalizing various industries and economic groups", and-To
"isolate and assess directly the costs of certain national benefits, such
as highways and social security.”

Obviously the two issues I wish to highlight
are: (a) the RE-distribution of wealth and income, and (b) to subsidize or
PENALIZE various industries and economic groups.This
was almost 70 years ago, and to this day the facts are hidden very well – in
plain sight.

Another example:A small (but not insignificant) group of
individuals have been screaming that the stock ‘market is rigged’ for almost as
long as the market has existed.Most
have been laughed at, called kooks, conspiracy nuts, right wing whackos, and
generally discarded. Then Michael Lewis
writes a book about High Frequency Trading (HFT), and suddenly ‘the market is
rigged’ is on everyone's lips. This same
market, has been right in front of our faces for years – explained, detailed,
and deciphered – yet ignored.

Of course it’s not just the stock market
and taxes that are rigged:

-Interest
rates are rigged. People hear about
LIBOR and (since it seems so exotic) they shrug their shoulders swearing that it
doesn’t really affect them. Honestly,
not too many years ago you could put $100,000 in the bank and make $7,000 a
year in interest. Now you make ZERO.-Energy
markets are rigged. They see J.P. Morgan
get slapped with billions in fines for energy market tampering, and they’re not
connecting the dots as to how gasoline has doubled in price over the past 5
years while demand (since 2004) has fallen like a rock.-Corporate
accounting is rigged. Corporate
reporting standards have lapsed so much that corporations are no longer
required to abide by GAAP (Generally Accepted Accounting Principles)
regulations when reporting their financial numbers.-Gold is
rigged. On Tuesday at 8:30am the gold
market recorded a ‘fake’ sale of $500 million in futures – causing gold to fall
$30 in a single hour.-Our own
FED is telling us that there is NO inflation; meanwhile the price of food
(alone) has increased 19% in the past 4 months (since January of 2014).

I think that the angst most people
feel around tax day isn't that they detest paying the taxes, but they abhor how
their tax dollars are being spent. Our own government hides the facts in
plain sight, counting on no one being able to see them.

A couple of thoughts (for Easter):

-Look up
– more than down,-Think
and Listen – more than talk, and-Reach-out
and Act on your own conclusions.

Happy Easter to everyone.

The Market...

We had a 4-day virtual ‘lift off’ that
took the DOW from a low of 16,028 on Monday, to a close of 16,409 on Thursday.We seem to have run back to the 16,460 area
of resistance.On April 9 we closed at
16,437 before falling in 3 days to 16,028. On March 10 we closed at
16,418 before plunging to 16,046. Naturally
the question is, do we fall again, or do we power up and set our sights on the
double top at the 16,600 area?

If you've noticed one thing in the
past couple of years it's the fact that this market is very tough to
short.The reason is clear. Every time we set up for a fade, the FED cuts that
fade short after a very quick 2 - 4% dip, and then blasts it right back up. I'm actually tired of writing how we get these
perfect ‘correction’ set-ups, only to see the FED short circuit the correction
and push us higher. So, while the single
biggest stock gains come during downtrends (because they’re so fast and
violent), I really haven’t been ‘short’ since the 2008 crash.

In the past 2 weeks, Ms. Yellen (before
Congress) stated that QE would end by the fall of 2014, and about 6 months
later interest rates would rise.The
markets went down violently on her words.This week Ms. Yellen came out and reversed herself, saying that because
the labor market is so soft, the FED will need to keep rates low for an extended
period. The markets soared back up on
her words. Unfortunately, the markets
are NOT moving on economic fundamentals, but rather moving on whether the FED
will continue to fill the punch bowl. In
many ways this more resembles a ‘drug addiction’ than ‘investing’.As long as our dealer can provide us with the
stuff we’re good, but as soon as the dealer cuts us off – we go into
withdrawal.

I said it before and I’ll say it
again:IF the FED stops tapering, or (worse)
reverses their taper and does more QE – we’re headed toward DOW 18,000 and
higher. It won't matter if the economy
grinds to an absolute halt and goes into a full-scale depression.With that in mind, I have no choice but to
continue to find the ‘long side’ opportunities. It feels wrong (almost ‘dirty’), but the fact
is that the markets are convinced that the FED will always support them, and therefore
a dip is just another buying opportunity.

We all know that this will end
badly. A chink in the armor could be the
NASDAQ.It’s still in a downtrend.I’m looking for the NASDAQ buying to stop on
Monday, and to continue it’s downtrend – potentially bringing weakness into the
S&P and the DOW over the next week or so.

The facts are: of the companies that
have reported thus far, 67% of them have MISSED their top line / revenue estimates.
And these ‘estimates’ have already been
lowered.These same companies are
beating on the bottom line by not hiring, doing stock buy-backs, and by manipulating
their accounting.Companies can easily ‘adjust’
their earnings per share, but they can't ‘adjust’ their revenues. Combine
that with the fact that just last week beef, pork, shrimp, soybeans and soy
meal all hit RECORD high prices.Combine
that with the steady climb back towards $4 per gallon gasoline and stagnant
wages.What you have is a market that
does not reflect our true underlying economy.

I'm still leaning slightly long on
the DOW, but I’m beginning to nibble on shorting the rallies on the
NASDAQ.Honestly – none of this feels
right.It feels like I’m missing
something – that’s right there in plain sight.

Tips:

The $500M ‘fake short’ in Gold surprised me (as it
did most people) last week.Our position
in TLT also took a hit last week – presumably on the belief that the dispute in
the Ukraine would be settled over this weekend.I’m still holding my position in (MNKD), for it’s 2% weekly yield on the
call options.MNKD is currently selling
for $6.25 / share – with the $6.50 call options paying you 13 cents per
week.The energy sector has been nothing
short of ‘on fire’ as of late, with our USO positions soaring for nice gains
indeed.I also opened some positions in
smaller stocks that I think have a good chance of doubling (or more) over the
next 12 to 18 months.Those stocks are
listed below, and a couple that I’m still following are:PFIE, LSCC, VNTR and FPP.This week I see TLT and Gold as being
buyable, and potentially the NASDAQ as being a nice short candidate – topping
off on Monday.

My
currentshort-term holds are:

-MNKD
– in @ $6.35 – (currently $6.25)

-USO
(Oil) – in @ $37.19 - (currently $37.68),

-BXE
(Oil) – in @ $9.11 – (currently $9.16),

-LSG
(Gold) – in @ $0.78 – (currently $0.75),

-NGLS
(Nat Gas) – in @ 60.11 – (currently $61.33),

-POZN
(Pharma) – in @ $8.68 – (currently $8.70),

-PTIE
(Pain Tmt) – in @ $5.34 – (currently $5.38),

-RFMC
(Tech) – in @ $7.96 – (currently $7.87),

-SIL (Silver) – in at 24.51 - (currently 12.33)
– no stop,

-GLD (ETF for Gold) – in at 158.28, (currently
124.74) – no stop ($1,295 per physical ounce), AND

Expressed
thoughts proffered within the BARRONS REPORT, a Private and free weekly
economic newsletter, are those of noted entrepreneur, professor and author, R.F.
Culbertson, contributing sources and those he interviews. You can learn more and get your free
subscription by visiting: <http://rfcfinancialnews.blogspot.com> .

Please
write to Mr. Culbertson at: <rfc@culbertsons.com> to inform him of any
reproductions, including when and where copy will be reproduced. You may use in
complete form or, if quoting in brief, reference <rfcfinancialnews.blogspot.com>.

If
you'd like to view RF's actual stock trades - and see more of his thoughts -
please feel free to sign up as a Twitter follower - "taylorpamm" is the handle.

If
you'd like to see RF in action - teaching people about investing - please feel
free to view the TED talk that he gave on Fearless Investing: http://www.youtube.com/watch?v=K2Z9I_6ciH0

To
unsubscribe please refer to the bottom of the email.

Views
expressed are provided for information purposes only and should not be
construed in any way as an offer, an endorsement, or inducement to invest and
is not in any way a testimony of, or associated with Mr. Culbertson's other
firms or associations. Mr.
Culbertson and related parties are not registered and licensed brokers. This message may contain information
that is confidential or privileged and is intended only for the individual or
entity named above and does not constitute an offer for or advice about any
alternative investment product. Such advice can only be made when accompanied
by a prospectus or similar offering document. Past performance is not indicative of
future performance. Please make sure to review important disclosures at the end
of each article.

Note:
Joining BARRONS REPORT is not an offering for any investment. It represents
only the opinions of RF Culbertson and Associates.

PAST
RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS
THE OPPORTUNITY FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING
ALTERNATIVE INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER
VARIOUS RISKS INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE
INVESTMENT PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT
TO THE SAME REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES,
AND IN MANY CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN
ONLY TO THE INVESTMENT MANAGER.

Alternative
investment performance can be volatile. An investor could lose all or a
substantial amount of his or her investment. Often, alternative investment fund
and account managers have total trading authority over their funds or accounts;
the use of a single advisor applying generally similar trading programs could
mean lack of diversification and, consequently, higher risk. There is often no
secondary market for an investor's interest in alternative investments, and
none is expected to develop.

All
material presented herein is believed to be reliable but we cannot attest to
its accuracy. Opinions expressed in these reports may change without prior
notice. Culbertson and/or the staff may or may not have investments in any
funds cited above.

Remember the Blog: <http://rfcfinancialnews.blogspot.com/>
Until next week – be safe.

GetAbby.com IVR Solutions

A TRIPLE is only a TRIPLE when you make it to 3rd BASE!

In today’s world, if you can’t achieve having ALL 3 - then you’re just hitting three singles – and NEVER putting everything together – and therefore NEVER putting yourself in ‘scoring’ position! And frankly, if you’re not going to ‘score’ - why be in the game? All 3 of these elements (web avatars, IVR solutions, mobile applications) NEED to work together, and combine in order to significantly reduce customer service costs, while dramatically enhancing the customer experience, and increasing your customer knowledge, retention and let’s not forget – increasing your bottom line.

First base is your speech application. Applications need to recognize voice commands, understand accents, languages, and colloquial enunciations, everyone sees the industry moving in this direction - from buying airline tickets to feeding your Xbox commands - virtually everything needs voice technology. Second base is web interactivity – the ability to ask a web avatar a question – in your own words – in your own language (very similar to speech). The extra element the web provides is instant connectivity to thousands of “friends” receiving and sending status updates - allowing your product to reach a wider audience, cheaper – better - faster.
Third base takes includes your mobile device. Apple has sold over 2 million ipads in 2 months – even though it’s only been released in 9 countries. 5 Billion iPhone apps have been downloaded. AT&T stopped taking orders for the iPhone 4G after being open for 27 HOURS. So if mobile devices are NOT be a part of your strategy, think again. And just do the math – a mobile device application can be written for tens of thousands – and circulated to millions of people – giving you a total cost of ownership in the ‘pennies’ - what other device offers that consistency - scalability – and cost?

Our job at GetAbby is to put you in position to score. We bring it all HOME. We take all three of these sigles, combine them, and allow you to bring it HOME in one application. GetABBY provides the technology that allows you to book airline tickets over the phone, and have the confirmation ticket sent straight to your mobile device, and confirm thru an avatar on the web – where the avatar will present you with more money saving ideas on additional places to stay. We’re there for you, ready to take you past third base – taking it home, however; is up too you to GetABBY.